In its first application of the landmark Browning-Ferris decision, the National Labor Relations Board (NLRB) has determined that ACECO, a contractor, was not a joint employer with Green Jobworks, its staffing agency. In Browning-Ferris, the NLRB held that two or more entities would be considered joint employers if each one possessed sufficient control over employees’ essential terms and conditions of employment. As discussed more here, this is significant because, even if the company is not the actual employer of workers, the company may be required to bargain with a Union and held liable for unfair labor practice charges if found to be a “joint employer.”
In the Green Jobworks case, the NLRB revisited the broader joint employer test of Browning-Ferris, and this time found that the Union failed to establish specific, detailed and relevant evidence demonstrating a joint employment relationship between Green Jobworks and ACECO. Green JobWorks is a staffing company that provides temporary labor to construction companies. ACECO is a demolition and remediation contractor who supplements its workforce with Green JobWorks employees.
Green JobWorks and ACECO entered into a Master Labor Services Agreement requiring Green JobWorks to provide workers who are responsible for tracking Green JobWorks employee hours, determining breaks, and removing Green JobWorks workers from the construction site, if necessary. Under the agreement, Green JobWorks was exclusively responsible for the following duties: (1) employee recruiting, hiring, counseling, discipline and discharge; (2) establishing and paying employee wages; (3) providing worker’s compensation insurance and fulfilling unemployment compensation obligations; and (4) maintaining personnel and payroll records for Green JobWorks employees. Project orientation and day-to-day schedules were determined by the general contractor.
The Local Union asserted that ACECO was a joint employer because: (1) the Master Labor Services Agreement gave ACECO the right to direct managers and supervisors, and to dismiss staff employees under certain circumstances; (2) ACECO had requested specific Green JobWorks employees with particular skills; and (3) ACECO effectively controlled the wages of Green JobWorks employees.
The NLRB rejected the Union’s argument, and distinguished the facts from those in Browning-Ferris. ACECO’s right to refuse or terminate a Green JobWorks employee was limited and not unqualified. ACECO could request specific employees, but the staffing agency was under no obligation to meet the request. Additionally, Green JobWorks employees could individually negotiate higher wages, and Green JobWorks was not prohibited from paying its employees more than ACECO paid its employees.
Regarding day-to-day supervision, ACECO, who was a subcontractor, did not determine the job tasks for Green JobWorks employees. Instead, they received project orientation and day-to-day schedules from the general contractor. Additionally, Green JobWorks field supervisors traveled to project sites to interact with lead employees, and lead employees were responsible for tracking Green JobWorks employee hours and determining breaks and rest period.
Accordingly, the NLRB found that ACECO was not a joint employer with Green JobWorks. The decision highlights the importance of an agreement that gives as much discretion to the staffing agency as possible. The Green Jobworks case is a reminder to franchisors, subcontractors, and business entities to pay careful attention to the “joint employer” standard.